Novo Nordisk's weight loss drug expands market

Novo Nordisk, the Danish pharmaceutical company behind the popular weight loss drug Wegovy, has announced that the drug has been approved for sale in China. This is an important milestone for the company, which opens up a vast new market. However, the company has said it will only launch the drug in China when it can guarantee a steady supply for existing users, as shortages have been a problem in the US and other markets.

Wegovy has been approved for long-term weight management in obese and overweight people in China who have at least one weight-related health condition. The company has not yet revealed when it will launch the drug in China, nor has it provided any details on possible pricing or the volume of supplies it plans to devote to the Chinese market.

Demand for Wegovy has been high and supplies of the smaller doses used by people starting treatment have been severely restricted for months in the US. As a result, it is unclear whether Wegovy's rollout in China will exacerbate or prolong this shortage, especially for the lower starting doses.

After the announcement of the Chinese approval, Novo Nordisk shares rose 1.6%. The success of the company's GLP-1 treatments, Wegovy and Ozempic, has significantly increased the company's market capitalization, which now stands at around $630 billion, up from $300 billion at the beginning of 2023.

In addition to the Chinese approval, Novo Nordisk has also announced plans to invest $4.1 billion in the development of a new US manufacturing facility in Clayton, North Carolina. The facility, expected to be completed between 2027 and 2029, will create around 1,000 new jobs and produce drugs such as Ozempic and Wegovy.

Despite the success of these drugs, Novo Nordisk and other pharmaceutical companies have faced criticism for the high prices of their products, especially in the US. a variety of conditions, including sleep apnea, heart problems, kidney disease and Parkinson's. This has led to shortages, with smaller initial doses often unavailable for months or years, and the company has acknowledged that this problem is unlikely to be resolved in the near future.